20 Mark Question - Ethics & Culture

Apoorva Mahajan

HOW MAY ETHICAL CONSIDERATIONS AND CULTURAL DIFFERENCES INFLUENCE LEADERSHIP AND MANAGEMENT STYLES ON AN ORGANIZATION? Google is a multibillion, multinational corporation that specializes in Internet based services; it has headquarters in California, and offices around the world with approximately 55,000 employees. It was also voted by Fortune magazine as one of the best companies to work for. Ethics is the judgement between what is morally right and what is not while culture is the customs, arts, traditions and social achievements of a particular nation, peoples, or group. These two things often affect many aspects of a business, especially Google. Using ethics in treatment of employees can be beneficial to Google because if each employee is treated similarly, there will be less conflict in the workplace and productivity will not hinder. This will also mean that there will be less chances of a trade union forming, leading to lower chances of collective bargaining and strikes occurring within the business itself - mostly because the demands of the Google employees are being met: they are given privileges and facilities including cars, gym facilities, and 30% of their work time is their own work. Since this is provided to all employees, the business cannot be accused of behaving unethically because none of the employees are being treated unfairly. If Google however, had highly skilled workers who worked for low pay and in unsafe working conditions it would be considered unethical. Most of the ethical decisions that involve managers are centered on the organization while the leaders have to focus on the people. A good leader in Google would be willing to take the blame for bad outcomes to the organization if it means to protect their employees from unwarranted criticism. If an employee is inexperienced and commits a mistake during their work, the decision to keep them on the grounds that the worker deserves a second chance can be seen as ethical because it is giving the employee a fair chance to fix their mistakes. This could be shown as a paternalistic leader, because they are focused on their employees and inspiring their employees to achieve the best they can. The same ethical decision if taken by the manager might have a completely different result; managers complete objectives and if an employee commits a blunder, this might set the manager behind on their objectives. This would force the manager to see the employee as a liability to the business and to prevent further economic loss to the business, the right decision in the mind of the employer might be to sack the employee. This could be seen as unethical because the manager is thinking of the profits, rather than the employee who has a major stake in the business. A drawback of ethics of having an existentialist view of ethics as Google does, is that the system can be easily exploited: this is especially so with Google since they follow a Laissez faire method of management which places a lot of trust in their employees. There is also the question of irresponsibility. Is it ethical to give workers so much responsibility and to wholeheartedly trust them, especially if they haven’t proved themselves to be trustworthy. Some workers may abuse this right and in the particular type of work culture that Google has, the management may not be

Apoorva Mahajan

aware of this problem until much later, meaning that the business could be very well losing out on profit and the problem would go on undetected which could be seen as unethical to the other stakeholders that are part of the business, especially the shareholders. Stakeholders that are most likely to be affected by the ethical decisions that the management and leaders take are shareholders and employees. Shareholders would be affected by the decisions due to the fact it affects their return on capital employed; if most of the net profits of the business are going into paying salaries and corporate social responsibility then the shareholders will not be pleased because the amount of dividends they will receive will decrease in quantity; this could be seen as unethical because most of the capital employed that Google runs on often comes from its shareholders and if they are not paid accordingly, it could be seen as unfair. Employees are equally affected by managerial decisions because it is under the instructions of the managers and the treatment of the managers that they are required to do their work under; if an employee is given special treatment over the others it may seem like the employer is being partial and it could be unethical to do so. However, Google manages to treat all its employees fairly, creating a powerful work culture where all the employees are respected and treated equally. Cultural difference are often common within businesses, especially a business which contains a high ethnic diversity; this can cause culture clashes between the different work cultures, i.e. a lot of business focus on either power or role culture and so employees who are new to Google may find it difficult to adjust to the person culture that is prevalent in the business. Person culture is more individualistic and the employees are are allowed to provide their own input, make their own decisions and have the freedom to express themselves. This is shown in Google’s practice of providing 30% of employee work hours to be dedicated to what the employee wishes to do. Obviously this shapes the management style at Google to be one of laissez faire due to the fact that the managers just provides objectives for the workers and they are allowed to do it their own way, leaving the focus on the employees. However, there is also the idea of power distance - measuring the extent to which the less powerful members of organizations and institutions (like the family) accept and expect that power is distributed unequally. This can be seen as shaping the work culture to be more power culture and the manager exhibits traits of an autocratic management which could make the employees unhappy because their voices are not being heard; at the same time, it could make work more efficient. Stakeholders that are affected by the culture within the business are employees and managers. Employees are affected the most because they are put under the strain of the culture that the business operates under. It depends from employee to employee because some work better in person culture because it allows them to express themselves but some employees are lazy and require a push - in which power culture is the best to use.

Apoorva Mahajan

Overall it can be said that ethics have a strong role to play within the business because the treatment of employees can affect the productivity and motivation of the workers; if the employees are being treated unfairly, there might be a feeling of resentment towards the management and leadership. Culture is closely linked to where the business is, for example a business in Japan will have a higher power distance than a business in California - it in turn affects the business’ way of leadership and management.